Northern Trust Q4 Earnings & Revenues Beat on Higher NII & Fee Income

Northern Trust Corporation’s NTRS fourth-quarter 2024  adjusted earnings per share (EPS) of $2.26 surpassed the Zacks Consensus Estimate of $2.02. In the prior-year quarter, the company reported earnings per share of 52 cents. Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.For 2024, adjusted EPS was $9.78, which beat the Zacks Consensus Estimate of $7.56. This compares unfavorably with $5.1 reported in the year-ago quarter.NTRS results benefited from a rise in net interest income (NII) and other fee income. Also, an increase in total assets under custody (AUC) and assets under management (AUM) balances supported financials. Strong capital ratios were another positive. Net income (GAAP basis) was $455.4 million, up significantly from $113 million recorded in the prior-year quarter.For 2024, the company reported net income (GAAP basis) of $2.03 billion, which increased 83.4% year over year.NTRS’ Revenues Rise & Expenses FallQuarterly total revenues (GAAP basis) of $1.96 billion increased 26.8% year over year. The top line also beat the Zacks Consensus Estimate of $1.93 billion.Full-year revenues were $8.3 billion, which increased 22.4% year over year. The top line beat the Zacks Consensus Estimate of $8.25 billion. NII on a fully taxable equivalent basis was $574.3 million in the quarter under review, up 14.6% year over year. The net interest margin (NIM) was 1.71%, up 12 basis points from the prior-year quarter.Trust, investment and other servicing fees totaled $1.2 billion, up 12.1% year over year. Other non-interest income was $173.6 million against a loss of $27.8 million reported in the year-ago quarter. The rise was driven by an increase in all components of other non-interest income. Non-interest expenses decreased nearly 1% to $1.38 billion in the reported quarter. The fall stemmed from a decline in occupancy and other operating expense.Northern Trust’s AUC and AUM RiseAs of Dec. 31, 2024, Northern Trust’s total AUC increased 12% year over year to $13.3 trillion. Also, total AUM rose 12.3% to $1.6 trillion.NTRS’ Credit Quality ImprovesTotal allowance for credit losses was $206.1 million, down 6.5% year over year. Total non-accrual assets decreased 11.9% to $56 million as of Dec. 31, 2024. NTRS reported negative provisions for credit losses of $10.5 million in the fourth quarter compared with a negative provision for credit losses of $8.5 million in the year-ago quarter.NTRS’ Capital and Profitability Ratios ImproveUnder the Standardized Approach, as of Dec. 31, 2024, the Common Equity Tier 1 capital ratio was 12.4%, up from 11.4% reported in the prior-year quarter. The total capital ratio was 15.1%, up from 14.2% in the year-ago quarter. The Tier 1 leverage ratio was 8.1%, which remained unchanged from the prior-year quarter.Return on average assets was 1.24%, up from 0.33% in the year-ago quarter. Also, the return on average common equity was 15.3% compared with the year-earlier quarter’s 4%.NTRS’ Capital Distribution ActivitiesIn the reported quarter, Northern Trust returned approximately $402.8 million to shareholders through share repurchases and dividends.Our View on NTRSA rise in fee income uplifted the company’s fourth-quarter performance. Its increasing AUC and AUM balances are likely to support financials. Improving credit quality was another positive. However, the uncertain global financial market and weak economic conditions could affect the bank’s businesses.Northern Trust Corporation Price, Consensus and EPS Surprise Northern Trust Corporation price-consensus-eps-surprise-chart | Northern Trust Corporation QuoteCurrently, Northern Trust carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Performance of Other BanksComerica Incorporated CMA reported fourth-quarter 2024 adjusted EPS of $1.2, missing the Zacks Consensus Estimate of $1.25. In the prior-year quarter, the company reported an EPS of $1.46.CMA’s results were negatively impacted due to a fall in NII and a weak asset quality. However, a rise in deposit balance, solid fee income growth and a strong capital position offered support. Fifth Third Bancorp FITB has reported fourth-quarter 2024 adjusted EPS of 90 cents, surpassing the Zacks Consensus Estimate of 87 cents. In the prior-year quarter, the company reported an EPS of 99 cents.FITB’s results benefited from a rise in NII and loan balances. The strong capital position was another positive. A decline in fee income and weak asset quality were headwinds.7 Best Stocks for the Next 30 DaysJust released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."Since 1988, the full list has beaten the market more than 2X over with an average gain of +24.1% per year. So be sure to give these hand picked 7 your immediate attention. See them now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Fifth Third Bancorp (FITB): Free Stock Analysis Report Comerica Incorporated (CMA): Free Stock Analysis Report Northern Trust Corporation (NTRS): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks